#21-Cloud Service Providers (CSP’s) and Enterprise-Tech: Can they disrupt pure Consulting?

I clearly remember the time I was really crazy to buy a DSLR camera and what a big deal it was. I purchased two Canon cameras (first in 2007 and second in 2009) spending around 4500 US Dollars in total. I cannot complain about the results and the picture quality. People who love digital SLR cameras, know-how phone photography have spoiled a lot of things.

However, things are different now.

Regular innovations in the selfie and the secondary phone camera qualities have resulted in shrinking the standalone camera market size (point of shoot and DSLR both)

Disruption: So what point am I trying to make?

1. When a single utility product can be bundled with another product (that offers multiple solutions), then the single utility product eventually gets disrupted.
2. This applies to services as well. Camera companies lost direct access to the consumer, who got lost in the whirlwind of smartphone camera upgrades
3. A smartphone is not one product it has multiple things all rolled in one (VCR, phone, map, walkman, thermometer, books, camera, calculator)

Image-Web

Consulting is becoming more about Digital Transformation

Most of the strategy consulting projects are around the digital transformation of clients. Companies want to build up business models that offer:

1. Customer-centric journeys with one-stop solutions (super apps)
2. Platform scale
3. Real-time data, Data-analytics maturity and monetization plays
4. AI-first models
5. End to End Automation to minimize costs, industry 4.0 tech
6. Seamless integration of business functions with Digita Supply chain
7. Connected offices and employees

Most of these solutions can also be offered only by enterprise tech players and cloud service providers too. Thus they are best suited to be the orchestrators of the B2B digital hardware and services ecosystem

They do not need consulting companies, but consulting companies need them for transformation

Strategy consulting faces threat from the Enterprise tech and cloud companies

Companies like Amazon Web Services, Microsoft , Google through their cloud services are trying to take charge of the Digital transformation agenda for the companies

1. AWS has industrywise offers for B2B clients. Services range from building a bank to building a connected car ecosystem. AWS revenues already cross 40 billion USD in 2019.

2. We all cannot help but notice the increasing number of strategy and digital transformation consulting talent these companies are hiring. Advisory and consulting can be offered as a value-added services along with the Cloud-driven transformation.

3. Microsoft Office, Azure, Teams, and One Drive, with its platforms, offer so many enterprise platforms to the B2B clients that adding strategy/transformation consulting expertise is a potential play for it.

4. When it comes to digital transformation implementation- cloud, IoT, Blockchain, AI, AR/VR, these enterprise tech companies are way ahead of pure consulting companies.

Should the Big 4’S worry?

1. Enterprise tech companies are still not mature with their consulting capabilities. However, they are very aggressive in taking charge of the B2B ecosystem, so that consulting players end up as just the partners.
2. The vendor image needs to be transformed into a consulting company image. If the cloud and enterprise companies get it right they can be the future Big 4 of consulting or they will end up like the IT vendors transformation partners. Only the future will tell, but Microsoft, AWS, and Google are betting big on enterprise offerings
3. When it comes to building AI-first and intelligent IoT organization, the Big-tech own the technology and platforms

AWS -products

There is a reason why the pure consulting companies have survived decades of disruption.

Some of the smartest people that I have personally met some from strategy consulting companies.

The next 20 years of consulting are going to be very different than the last 50 years of consulting:

1. Information is free. There are so many industry trends and reports available on the internet. So how do you differentiate yourself
2. Digital Talent and in-house capabilities will be the key to the future of consulting.
3. Think in terms of solutions and build ready to deploy products/platforms/API/solutions for the client
4. Account Relationships will matter, but only relationships will not help. Value creation in consulting will matter more than ever
5. Outcome or impact based fee models will be more rampant

Consulting like Banking will always be needed.

COVID-2019 pandemic has accelerated the need for a lot of traditional companies to go digital. Thus, they need consulting services to guide them on the best in class models and execution roadmap.

Pure Consulting companies are getting disrupted from all directions- Accounting Big 4’S, IT consulting, Cloud, Enterprise tech providers.

The real question is that will it be the pure consulting companies that will own the industry or will they be disrupted by the cloud and the enterprise tech giants.

Regards,

Sidhartha Sharma

Digital Expert and Author

Twitter: https://twitter.com/Siddhartha_monk